Airliners-India.com Flickr Group & Facebook    FAQ   Search   Memberlist   Usergroups   Register   Profile   Log in to check your private messages   Log in  JET-SAHARA Deal Restruck Goto page Previous  1, 2          Airliners-India.com Forum Index -> Civil Aviation View previous topic :: View next topic   Author Message Nimish Member Joined: 16 Dec 2006 Posts: 9757 Location: Bangalore, India Posted: Wed Apr 11, 2007 11:21 am    Post subject: From HT.com Final price close to original price - except that now 9W does not pay for or take on the S2 creditors Quote: The aborted deal saw chances of revival 10 days ago when both parties began negotiating for settling out of court. Air Sahara insisted that Jet Airways had to pay Rs 1,350 crore to take over the company, sources said. “Jet seems to have no other option but to accept Sahara’s price,” they added. “Goyal could be suing for a truce to prevent additional financial losses. He has already spent Rs 180 crore in running Air Sahara for three months. Also, Rs 500 crore has been paid in advance. Bank guarantees of Rs 1,500 crore have been given. All these funds are locked. Sahara has demanded Rs 350 crore as compensation for running the airline for a year. Under these circumstances, for Goyal it is better to negotiate a lower price rather than paying the full compensation,” said an investment banker close to the transaction. Jet Airways, which had paid an advance of Rs 500 crore to Air Sahara and spent Rs 180 crore towards running the airline during the transition period, has been bargaining since Monday to pay a lower amount to settle the matter. Air Sahara executives said their demand of Rs 1,875 crore was not a discounted rate as made out to by Jet Airways. “Earlier, the deal was for Rs 2,200 crore and of this Rs 325 crore was earmarked as creditors’ deductions. Anyway, we were to get Rs 1,875 crore from the sale. Since they have already paid an advance of Rs 500 crore, now our demand is that the balance Rs 1,375 crore must be paid to us directly without any creditors’ deduction. We will withdraw our case,” said sources in Air Sahara. Air Sahara is insisting that the fresh deal must be signed before the tribunal, which should be ratified by the Bombay High Court. At this stage it seems like an awesome deal for S2 and a bad one for 9W! Back to top Nimish Member Joined: 16 Dec 2006 Posts: 9757 Location: Bangalore, India Posted: Wed Apr 11, 2007 11:30 am    Post subject: Nimish wrote: At this stage it seems like an awesome deal for S2 and a bad one for 9W! I guess if this is true, then it's a case of one's karma coming back to catch up. 9W was most unprofessional to walk out of the deal last time using some silly excuses, and now that the tribunal is meeting, I guess 9W is trying to avoid the huge penalty that might have been awarded, and rather use the money to buy S2. Poor 9W - 1 bad decision continues to haunt them. Back to top blrsea Member Joined: 25 Mar 2007 Posts: 182 Posted: Wed Apr 11, 2007 11:32 am    Post subject: The only downside is that I will no longer see those cute S2 FAs in nice sarees That leaves only IC/AI with any Indian flavour in them Back to top VABBy Member Joined: 19 Dec 2006 Posts: 823 Location: DEL Posted: Wed Apr 11, 2007 11:46 am    Post subject: Nimish wrote: I guess if this is true, then it's a case of one's karma coming back to catch up. 9W was most unprofessional to walk out of the deal last time using some silly excuses Actually this highlights what kind of babu culture is even prevenlent in Jet. Just because u have chick airhostesses and plus offices doesnt make an airline truly a modern and a world class airline. And the recent resignation by the top level brass clearly highlights it that how authority and responsibility hasnt been delegated to the team properly. And this has more got to do with Jet being a new company with a fellow owning the Jet brand being the new millionare. _________________ Expeditors- You'd be surprised how far we will go for you www.expeditors.com Back to top karatecatman Guest Posted: Wed Apr 11, 2007 1:03 pm    Post subject: The airline scene in India may now be towards cartelisation. May now look like this: Air India-Indian and its new international/domestic LCC Jet-Sahara Kingfisher, which may now revive plans to swallow Air Deccan. DN is bailing out its net to a variety of companies. So it might be Kingfisher-Air Deccan. Indigo and SpiceJet battle it out. Paramount will survive, flying at a lower level Airlines that may go out: Go Air Back to top tayaramecanici Member Joined: 03 Jan 2007 Posts: 648 Posted: Wed Apr 11, 2007 3:16 pm    Post subject: Quote: Sorry - I fail to see the logic here. How is this bad news for Indian aviation? Haven't we all agreed that consolidation is much needed, and what is this if not consolidation? Have we all agreed that consolidation between the only pvt operators allowed to fly Intl till date without any hope for the otners to do so immediately is much needed ? BS, by the time others are eligible they will have sunk under the burden of flying the profitless dom sectors with their enlarged fleets. With this CONSOLIDATION 9W can hammer the prices on the dom milk runs draining the competition dry. Quote: The way NG is allowed to write the rule book to his advantage This is the one that has me most confused. I thought the MoCA and DGCA made the M&A rules and framework very clear last year and I don't see where NG is bending the rule book in this case. Won't the same rules be applied to AI/IC as to 9W/S2? Firstly keep AI/IC out of the equation, its totally skewed to use the 2 as a benchmark being owned by the rule makers. However having said that 9W also comes under this tag of owned by rule makers where else in the world would you find a consolidation wherein the DGCA or the MoCA do not have a clear cut policy as to how they plan to maintain the level of competition across the playing field. To substantiate my point here is a quote from an article published in Airline Business in June '06 ''Industry analysts have for months been saying Jet agreed to pay too much for loss-making Air Sahara, which is seeing its market share fall as aggressive new players grow. With Jet not commenting in recent days despite so much negative publicity, there is a growing view in India that it was happy to use the delayed regulatory approval as an excuse to walk away from the deal.'' Quote: If EU, Kingfisher would have been allowed another go at S2 Another statement that has me confused. At last count Mallya was willing to pay only 750 Crores for S2, while Goyal is paying 2-2.5 times that amount. Why would this be anything other than a commercial decision for S2 - and how does the EU come into this? Here is the quoted price from an article on Bloomberg not one from any ORIFICE ''Kingfisher valued Sahara at $400 million, and then withdrew its offer.'' Does this sound close to the figure being banded right now the reason i mention EU is because of their parliamentary democracy similar to India's Back to top tayaramecanici Member Joined: 03 Jan 2007 Posts: 648 Posted: Wed Apr 11, 2007 3:22 pm    Post subject: sammyk wrote: Why is everyone making a big deal about these leased aircraft? Jet Airways should be able to bring them up to their standards. Repaint them and refurbish the interiors. Who are they leased from anyway, a leasing company or another airline? Either way they will have to repaint them and they could always put the Sahara interior back in when they return them. Then again they could also just renew the lease if possible. IT is a very high cost to maintain these aircrafts back to delivery status. These aircrafts considering their time on S2 registry will have to undergo a 8C check which is the highest and can cost close to $1.5m a piece on the lower side Back to top tsk911 Member Joined: 19 Dec 2006 Posts: 223 Location: DEL Posted: Wed Apr 11, 2007 10:44 pm    Post subject: tayaramecanici wrote: sammyk wrote: Why is everyone making a big deal about these leased aircraft? Jet Airways should be able to bring them up to their standards. Repaint them and refurbish the interiors. Who are they leased from anyway, a leasing company or another airline? Either way they will have to repaint them and they could always put the Sahara interior back in when they return them. Then again they could also just renew the lease if possible. IT is a very high cost to maintain these aircrafts back to delivery status. These aircrafts considering their time on S2 registry will have to undergo a 8C check which is the highest and can cost close to $1.5m a piece on the lower side You seem to have a good knowledge of all such things.... _________________ Nalini... The Princess of the Sky... You are a star which will continue to illuminate your own A.net-India forever... Back to top tayaramecanici Member Joined: 03 Jan 2007 Posts: 648 Posted: Thu Apr 12, 2007 12:08 am    Post subject: karatecatman wrote: The airline scene in India may now be towards cartelisation. May now look like this: Air India-Indian and its new international/domestic LCC Jet-Sahara Kingfisher, which may now revive plans to swallow Air Deccan. DN is bailing out its net to a variety of companies. So it might be Kingfisher-Air Deccan. Indigo and SpiceJet battle it out. Paramount will survive, flying at a lower level Airlines that may go out: Go Air The airline scene in India is still very raw. The players need to stregthen their operations across the network, thats Dom and Intl. India is at the forefront of a globalised economy, the EU-USA O S will see huge changes in the industry. The next thing you know airlines from EU will be knocking on GOI to open the sector to competition from EU based airlines i.e. Set up a Virgin-India. The airlines based in India should be allowed to fly Intl unhindered. Only then can they face up to the challenges and look for their rightfull place in the globalised world. IMO there won't be further consolidation within the industry. Most players have sizeable route network as per their fleet. Going fwd with fleet expansion it is obvious the airlines need to operate Intl. You can clearly see DN, Spice and Indigo growing into being major operators, like Easyjet and Ryanair, within Asia (West, South and SE). AI/IA, JET and KingFisher being the more global face of Indian aviation. These airlines need to grow rapidly and consolidate their position within their projected routes. This can only happen if they are allowed to operate Intl ASAP. The 5yr rule was conjured during an era where air travel was considered to be a luxury for few. Right now with the Indian economy projected to eclipse most established economies in West and in Asia, India needs a robust airline industry that can support the worlds most cost effective SERVICE industry. The present soft/raw state of the industry can spell doom for the economy, if 9W collapses, lessors will blacklist India once again like they did following the debacle of East-West and ModiLuft OR if 9W manages to scuttle the growth of others it will lead to the same. Service industry will relocate to places like Dubai and Singapore due poor and expensive air connectivity. I was witness to the scrouge of the plague scare of 1994 when most airlines world-wide had stopped flying into India, including the bloody airlines in the Gulf. Emirates started flying after 30days on being threatened by Harasimha rao to cancel its gratous flying rights, it was a gut wrentching sight to see aircrafts from India being shunted to a side of the airfield at LHR and the pax quarantined at the terminal. India needs to have a trustworthy strong Airtravel Industry. NG has got a few GHOSTS in his closet. I've said this before this man does not give you a feeling of him being a scrupulous character, much like subroto, its for all to see how S.Roy is being unmasked ? I have no doubt that if NG tries to walk away from the merger this time round he will end up like THAKI, the CEO of East-West, a lot of crooks from UP have their money locked in S2 ! Back to top stealthpilot Member Joined: 19 Dec 2006 Posts: 2325 Location: BLR, DXB Posted: Thu Apr 12, 2007 5:14 am    Post subject: I don’t see IT and DN merging, what similarities do they have- their business models are polar opposites. Granted, they share a common fleet type but Kingfisher has said many times that they are not interested in the low cost model. tayaramecanici wrote: India is at the forefront of a globalised economy, the EU-USA O S will see huge changes in the industry. The next thing you know airlines from EU will be knocking on GOI to open the sector to competition from EU based airlines i.e. Set up a Virgin-India. The airlines based in India should be allowed to fly Intl unhindered. Only then can they face up to the challenges and look for their rightfull place in the globalised world. Absolutely agree! The industry is still small and the change in the coming years will be immense. India needs powerful carriers, and opening up markets is the way to go. I’m all for allowing foreign investment I airlines (Virgin India) but the industry has to be unshackled on all front. _________________ eP007 Back to top HAWK21M Member Joined: 19 Dec 2006 Posts: 8132 Location: Mumbai, INDIA Posted: Thu Apr 12, 2007 10:50 am    Post subject: How many Aircraft would be reatained & what about the Employees. regds MEL _________________ Think of the Brighter side !!! Back to top tayaramecanici Member Joined: 03 Jan 2007 Posts: 648 Posted: Thu Apr 12, 2007 1:24 pm    Post subject: HAWK21M wrote: How many Aircraft would be reatained & what about the Employees. regds MEL As marginally larger stakeholders i.e. Aviation employee and traveller, we (u & me ) in particular need a more vibrant Indian aviation industry for a better future. A trully strong aviation industry wil see huge numbers of jobs not only in the airlines but also in supporting segments, Aviation related manf, designing, after market etc. The bloody govt owned airlines and monopolistic pvt airlines have choked the growth of aviation in India. You never get to read a trully investigative analysis of national waste due to these GOI airlines. EK, SQ, CX have created world class busiess hubs, every airline worth its salt (i am getting emotional) wishes to expand its services to India and what eff are our dom airlines doing, prove to a Tobaccowala how much money they have as reserves before they start flying Intl or expanding their fleet. How can you have bloody unethical fool setting standards here. Shamshadabad and Devanhalli will easly add 1% to the GDP growth of India when they come online, similarly MAA with its second runway will cause havoc to Singapore if managed efficiently. Every region in India has a stake in the even growth of Aviation industry. Back to top Boeing7xx Member Joined: 23 Dec 2006 Posts: 477 Location: WSSS Posted: Thu Apr 12, 2007 2:51 pm    Post subject: As per the news trickling in, Jet "HAS" bought Sahara once again. Wonder which is the leg and which is the cement block. Back to top himmat01 Member Joined: 19 Dec 2006 Posts: 1392 Location: DEL Posted: Thu Apr 12, 2007 3:21 pm    Post subject: Jet has finally bought Air Sahara for Rs. 1450 Crore. Rs. 500 crore has already been paid. Rs. 400 crore is to be paid on or before April 20th. The balance will be paid in 4 annual installments commencing on or before March 31st 2008. The deal has been cleared by the arbitration panel. _________________ Save Maharashtra! Back to top G-BYGB Member Joined: 21 Dec 2006 Posts: 1813 Location: Bangalore/Delhi Posted: Thu Apr 12, 2007 3:33 pm    Post subject: How are the investors of 9W reacting right now to the buying of S2? _________________ www.flickr.com/G-BYGB photos Back to top blrsea Member Joined: 25 Mar 2007 Posts: 182 Posted: Thu Apr 12, 2007 4:52 pm    Post subject: Jet to buy out Air Sahara for Rs 1,450 cr Quote: Ending months of acrimony and legal disputes, Jet Airways today struck a deal to buy out Air Sahara for Rs 1,450 crore after clearance by a three-member arbitration panel. Jet Airways Chairman Naresh Goyal said this price represents a 40 per cent discount to the originally agreed price. ... Jet informed the Bombay Stock Exchange that it has agreed to acquire "all shares of Sahara Airlines Ltd for a lump sum price of Rs 1,450 crore. "While Rs 500 crore has already been paid, Rs 400 crore is payable immediately no later than April 20. The balance of Rs 550 crore is payable in four interest free annual equal instalments commencing on or before March 30, 2008." ... The deal would give Jet more than 32 per cent share of the domestic aviation market and add at least 27 aircraft to its 62-aircraft fleet, in addition to prime landing and take-off slots at major airports such as London Heathrow, New Delhi and Mumbai. It would become the only privately owned Indian airline with permission to fly overseas. Wow!! Jet saved Rs 1050 crores !! Earlier it had agreed to pay Rs 2500 crores! So, Mallya has been vindicated after all. His offer is close to what Jet ended up paying. Wonder if Sahara spoke to Kingfisher again before finalizing this deal? Would Kingfisher have paid the entire amount in shorter period than 9W? Back to top Nimish Member Joined: 16 Dec 2006 Posts: 9757 Location: Bangalore, India Posted: Thu Apr 12, 2007 7:54 pm    Post subject: After the last round and the experience from there, I hope S2 has put in some sharp teeth into the agreement in case 9W gets second thoughts. On the whole - very good news for the industry as S2 has been saved for the ruin it was busy setting itself up for. Back to top the_380 Member Joined: 19 Dec 2006 Posts: 2329 Location: Mumbai, India Posted: Thu Apr 12, 2007 8:55 pm    Post subject: So S2 is the first major carrier to go out. _________________ http://www.myspace.com/avsatsworld A Walt Disney and 20th Century Fox Audio Producer!!! Back to top G-BYGB Member Joined: 21 Dec 2006 Posts: 1813 Location: Bangalore/Delhi Posted: Thu Apr 12, 2007 10:44 pm    Post subject: Will 9W use S2 as a seperate low cost carrier to tackle other LCCs like DN,SG and G8,while 9W will compete with KF,IC?Are there any possibility of this taking place.So that 9W will be able to maintain its dominance of the domestic market.This will give 9W an advantage over KF interms of market share which they seem to have lost it a little bit to KF in the recent times. _________________ www.flickr.com/G-BYGB photos Back to top G-BYGB Member Joined: 21 Dec 2006 Posts: 1813 Location: Bangalore/Delhi Posted: Thu Apr 12, 2007 10:58 pm    Post subject: Most of the senior officials of other airlines have welcomed this move.They say its a good sign for the Indian aviation industry. _________________ www.flickr.com/G-BYGB photos Back to top the_380 Member Joined: 19 Dec 2006 Posts: 2329 Location: Mumbai, India Posted: Fri Apr 13, 2007 2:12 am    Post subject: G-BYGB wrote: Most of the senior officials of other airlines have welcomed this move.They say its a good sign for the Indian aviation industry. Still awaiting S2's employees reaction. Remember the last time when the deal was made and 9W started managing S2, around 20 pilots who had flights that day went on a sick leave and 9W had to call its pilots to operate those flights and some flights were combined _________________ http://www.myspace.com/avsatsworld A Walt Disney and 20th Century Fox Audio Producer!!! Back to top VABBy Member Joined: 19 Dec 2006 Posts: 823 Location: DEL Posted: Fri Apr 13, 2007 9:26 am    Post subject: Pilots will be hit becoz S2 is paying more to its pilots than jet so all the contracts have to be renegotiated. _________________ Expeditors- You'd be surprised how far we will go for you www.expeditors.com Back to top malQ Member Joined: 20 Dec 2006 Posts: 713 Location: Delhi, India Posted: Fri Apr 13, 2007 1:50 pm    Post subject: Just disembarked from a 9W flight, and must say,the ride in the rather tatty 737-700 felt like I was flying S2. Air-con didn't work throughout, galley not working so no tea-coffee service, cabin crew "forgot" the toffees, a pax asked for cotton and the cabin crew said "Ma'am, we will give it after take-off" . . . but most of all, the streaks of oil across the starboard wing remind one of S2 a lot. Maybe this will be the new announcement from NG on 16th? Back to top HAWK21M Member Joined: 19 Dec 2006 Posts: 8132 Location: Mumbai, INDIA Posted: Fri Apr 13, 2007 9:06 pm    Post subject: [quote="malQ"] Air-con didn't work throughout[quote] Thats the Gasper not working not the AC. regds MEL _________________ Think of the Brighter side !!! Back to top tsk911 Member Joined: 19 Dec 2006 Posts: 223 Location: DEL Posted: Sun Apr 15, 2007 12:44 am    Post subject: Shahrukh 'SRK' Khan to be the brand ambassador of Jet... He's also on the board... _________________ Nalini... The Princess of the Sky... You are a star which will continue to illuminate your own A.net-India forever... Back to top victor2alpha Member Joined: 08 Apr 2007 Posts: 120 Posted: Sun Apr 15, 2007 4:03 pm    Post subject: Where is Subrato ? Havent seen him for ages leave alone even in the past few days of this acqui.. _________________ victor2alpha Back to top tsk911 Member Joined: 19 Dec 2006 Posts: 223 Location: DEL Posted: Sun Apr 15, 2007 6:34 pm    Post subject: victor2alpha wrote: Where is Subrato ? Havent seen him for ages leave alone even in the past few days of this acqui.. Don't worry... If you are invited for the Ash-Abhi wedding you might spot him there 'coz he is also among the invitees... _________________ Nalini... The Princess of the Sky... You are a star which will continue to illuminate your own A.net-India forever... Back to top karatecatman Guest Posted: Sun Apr 15, 2007 6:47 pm    Post subject: Air Sahara travellers remain stranded Air Sahara travellers remain stranded http://www.ndtv.com/convergence/ndtv/story.aspx?id=NEWEN20070008823 Back to top G-BYGB Member Joined: 21 Dec 2006 Posts: 1813 Location: Bangalore/Delhi Posted: Sun Apr 15, 2007 7:23 pm    Post subject: Jet Airways announced that it will formerly unveil its new livery and logo soon. _________________ www.flickr.com/G-BYGB photos Back to top G-BYGB Member Joined: 21 Dec 2006 Posts: 1813 Location: Bangalore/Delhi Posted: Sun Apr 15, 2007 11:22 pm    Post subject: The Jet-sahara deal seem to have not gone well with the employees of air sahara.In TRV a S2 flight got delayed for two days due to technical snag.Passengers were stranded and they were not provided with a alternate arrangeement. Looks like Jet airways has to assure S2 staffs that their current job will be protected. _________________ www.flickr.com/G-BYGB photos Back to top sri_bom Member Joined: 22 Dec 2006 Posts: 2365 Location: Singapore Posted: Mon Apr 16, 2007 8:54 am    Post subject: Jet Airways reportedly plans to operate Air Sahara as a separate, debt-free, “value-based” airline (Economic Times, 16-Apr-07). Air Sahara will reportedly be rebranded within a few months. Both carriers’ networks would be integrated, with the value-based unit launching services to the Gulf region from early 2008, subject to government approval. Jet Airways: “We do not believe in LCC operations as the costs are the same to all airlines irrespective of their models. Under the value carrier model, Air Sahara would be operated with all economy class and less frills. The proposed model will be offering basic amenities onboard like light food and water. The configuration of aircraft would be changed to include as many seats to enhance revenues. The new name of the subsidiary would be selected at a later stage”, unnamed executive. Source: Business Standard, 14-Apr-07. 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